Rove Biggest Super-PAC Loser, Trump Says Waste of Money

Karl Rove, Republican strategist and former senior political advisor to President George W. Bush. Photographer: Jay Premack/Bloomberg

Nov. 8 (Bloomberg) -- Karl Rove and his investors were the
biggest losers on Election Day.

The Republican strategist created the model for outside
money groups that raised and spent more than $1 billion on the
Nov. 6 elections -- many of which saw almost no return for their
money.

Rove, through his two political outfits, American
Crossroads and Crossroads Grassroots Policy Strategies, backed
unsuccessful Republican presidential contender Mitt Romney with
$127 million on more than 82,000 television spots, according to
Kantar Media’s CMAG, an ad tracker based in New York. Down the
ballot, 10 of the 12 Senate candidates and four of the nine
House candidates the Rove groups supported also lost their
races.

The results have angered some Republicans who blame Rove
for “sidelining conservatives” and diverting money from them.

“Right now there is stunned disbelief that Republicans
fared so poorly after all the money they invested,” said Brent
Bozell, president of For America, an Alexandria-based nonprofit
that advocates for Christian values in politics. “If I had
1/100th of Karl Rove’s money, I would have been more productive
than he was.”

Trump Criticism

Donald Trump posted a message on Twitter saying: “Congrats
to @KarlRove on blowing $400 million this cycle. Every race
@CrossroadsGPS ran ads in, the Republicans lost. What a waste of
money.”

Jonathan Collegio, a Crossroads spokesman, declined to
comment for this article. Rove couldn’t be reached.

Rove argued today that Romney lost in part because
President Barack Obama outspent him on TV when outside groups
are taken out of the equation.

“This shows that money does matter in politics,” Rove
said on Fox News, where he is a paid commentator. In hindsight,
Romney should have used his resources to defend himself because
that isn’t the strong suit of groups like Crossroads, Rove said.

Obama aired more than twice as many ads on local broadcast
and nation cable as Romney during the general election,
according to CMAG. However, when outside groups such as the ones
Rove steers are added in, each side had about the same number of
ads on TV.

$176 Million

The Election Day results showed Rove’s strategy of bringing
in huge donations from a few wealthy benefactors and spending
that money almost completely on television advertising failed.
The Center for Responsive Politics estimates the two Crossroads
groups spent about $176 million, making them the top non-candidate and non-party spender of the election. Rove has
bragged of raising more than $300 million for his groups.

American Crossroads, a super-political action committee,
discloses its contributors and spending to the Federal Election
Commission. Its affiliate, Crossroads GPS, is organized as a
nonprofit social-welfare group that conceals its donors and
reports only a fraction of its political activities.

“If the rule in politics is you win or lose by the
election results, Karl Rove is a big-time loser in the 2012
presidential and congressional races,” said Fred Wertheimer,
president of Democracy 21, which advocates for limits to
campaign spending.

Still, “Karl Rove certainly knows how to make a lot of
money for political consultants and TV stations,” he said.

‘Poor Return’

Democrats also piled on. “If Crossroads were a business,
and Rove was the CEO, he’d be fired for getting a poor return on
his investment,” New York Senator Charles Schumer, the
chamber’s third-ranking Democrat, told reporters today at a
Christian Science Monitor breakfast.

The return on investment for American Crossroads donors was
1 percent, according to an analysis by the Sunlight Foundation,
a Washington-based group that advocates for open government. The
group calculated the number based on how much of the money was
spent supporting winners.

For donors to sister-organization Crossroads GPS, the
success rate was 13 percent, the group said. That’s a lower
return than for donations to the National Republican
Congressional Committee and to the two major Democratic
congressional super-PACs, according to Sunlight.

Homebuilder’s Money

Houston homebuilder Bob Perry gave $7.5 million to Rove’s
American Crossroads and another $8 million to Restore Our
Future, a super-PAC that supported Romney. He also gave $1
million to Independence Virginia, a super-PAC that backed former
Republican Governor George Allen in a U.S. Senate race. Allen,
with 47 percent support, lost to another former governor,
Democrat Tim Kaine, who won 52 percent of the vote. Even after
the losses,Perry spokesman Anthony Holm said the super-donor has
no regrets.

“Bob Perry will always support efficient government and
pro-liberty and opportunity agendas, always,” Holm said in a
telephone interview. “He was proud to do it this election cycle
and is likely to continue into the next cycle.”

The Crossroads groups spent $10.2 million in an effort to
oust Ohio Democrat Sherrod Brown from the Senate, and overall
outside groups spent much more. Brown beat his opponent, State
Treasurer Josh Mandel, 50.3 percent to 45.1 percent, with an
independent candidate winning 4.6 percent of votes cast.

“His brand of politics is pretty discredited,” Brown said
of Rove on a conference call. “He thought spending $40 million
against me and against the president would bring us down.”

Ohio Loss

Rove was particularly upset about Romney’s Ohio loss. A
former adviser to George W. Bush, he was acting as a commentator
on Fox News when the network called the state for Obama. Rove,
on air, said he didn’t believe it. He continued to argue with
the newscasters while shuffling through papers and calling
Ohio’s secretary of state and Romney’s campaign manager for more
information.

“This is premature. We’ve got a quarter of the vote”
outstanding, he said. Fox didn’t withdraw its Ohio call for
Obama and neither did other networks, predictions that
ultimately proved true when the final votes were counted.

Rove’s groups spent $11.4 million in their bid to defeat
Kaine in Virginia. They spent $7.76 million trying to unseat
Florida Senator Bill Nelson, according to CMAG. Nelson, a
Democrat, held his seat as well. The CMAG estimates are for ads
on broadcast TV and national cable from April 10, 2012 through
the day before the election.

The Crossroads groups bet successfully -- although less
than $200,000 -- on Republican Deb Fischer to win an open seat
in Nebraska.

Split Decision

On the House side, Rove scored wins in five of nine races.
Among those winners was David Valadao of California’s 21st
District, where Crossroads GPS spent $437,390, and Republican
Tom Latham who beat Democrat Leonard Boswell in Iowa with the
help of $432,640 from Crossroads, according to CMAG.

Serving as a Democratic counterweight to Rove was Bill
Burton, a former Obama aide who left the White House to form
Priorities USA Action. That super-PAC raised and spent about $67
million, a fraction of the budgets for the pro-Romney groups
that carried a 100 percent return with Obama’s re-election
victory.

Questions Ahead

“There will be a lot of questions raised about just how
much bang for their buck Republicans got out of super-PACs,”
Burton said. “Billionaires on the Republican side are probably
wondering what difference their contributions made in this
election.”

He said he spoke with many of his own large donors today
and described them as “ebullient.”

Majority PAC, which aided Democratic Senate candidates,
spent about $37 million, and 70 percent of that money was used
in successful elections. House Majority PAC backed Democratic
congressional candidates with $31 million; 44 percent went into
winning races, the Sunlight study found.

Other groups emulated the Rove approach, bringing at least
$306 million of untraceable donations into the 2012 races,
according to the Center for Responsive Politics.

Americans for Prosperity, founded 10 years ago by
industrial billionaires David and Charles Koch, didn’t have much
of a better night than the Rove groups.

The nonprofit group raised and spent $140 million this
year, President Tim Phillips said in an interview.

Playing Field

It bought about $34 million in TV ads attacking Obama and
urging people to vote him out. Its $14 million purchase of TV
ads in Senate races also turned up few victories.

“We leveled the playing field, but we weren’t quite able
to get it done,” he said.

The largest chunk of the money, $1.2 million, went into the
Wisconsin Senate race, according to CMAG.

“Have you seen Tammy Baldwin’s voting record?” a woman
asks with disgust in a spot than ran about 800 times last month.
Baldwin, the Democrat, won last night

The group also spent $622,400 on ads attacking Nelson in
Florida, $513,000 on McCaskill in Missouri, $486,000 on Kaine in
Virginia, $466,000 on Joe Donnelly in Indiana and Jon Tester in
Montana. Those Democrats all won.

AFP made $754,000 in ad buys in Nebraska and Nevada and saw
its preferred Republican candidates win in those races.

Phillips said the group is in politics for the long haul,
and compared Republicans with Democrats in 2004, when they lost
the White House, yet went on to win Congress in 2006 and the
presidency in 2008.

Emulating Soros

Phillips has said he is modeling the group after voter-turnout efforts billionaire investor George Soros made in 2004.
Soros put up $24 million -- at the time a record -- in a failed
effort to defeat Bush.

“George was certainly disappointed at Bush’s victory in
2004, but he did not feel that he had made a mistake,” said
Michael Vachon, his spokesman. “He felt he acted out of his
conviction that Bush was leading the country in a dangerous
direction.”

Soros, however, pulled back on his political activities
after the loss. It remains to be see whether rich Republicans
will come back for another round after these results.

Sheldon Adelson, whose family’s $53.4 million investment in
federal candidates and outside groups made him 2012’s top donor,
didn’t give money to American Crossroads. Yet he, too, saw his
preferred elected officials swept away. Adelson, the 25th
richest person in the world according to the Bloomberg
Billionaires Index, is head of Las Vegas Sands Corp., the
world’s largest casino company.

While leaving Romney’s post-election party in Boston last
night, Adelson was asked by a Norwegian television reporter how
his political donations were spent.